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Fact Pattern A (Questions 13-14 apply) Haruko, who owns and operates Garden Orchard, agrees to sell Fresh Produce Cooperative ten bushels of apples....

Fact Pattern A (Questions 13-14 apply)

Haruko, who owns and operates Garden Orchard, agrees to sell Fresh Produce Cooperative ten bush¬els of apples.

13. Refer to Fact Pattern A. When bad weather destroys Garden Orchard’s apple crop, Haruko’s obliga¬tion to deliver apples to Fresh Produce is

a. breached.
b. discharged.
c. not affected.
d. suspended.

14. Refer to Fact Pattern A. When the market price for apples exceeds the price in the contract with Fresh Produce, Haruko decides not to deliver the apples. This

a. breaches the contract.
b. discharges the contract.
c. has no effect on the contract.
d. suspends the contract.

CHAPTER 11

TRUE/FALSE QUESTIONS

15. The UCC imposes the same rules of conduct on all parties in all circumstances.

ANSWER: TRUE OR FALSE

16. A consumer lease is exempted from coverage under the UCC.

ANSWER: TRUE OR FALSE

17. Under the UCC, the validity of a contract depends on its price term.

ANSWER: TRUE OR FALSE

18. If a contract for a sale of goods does not include a price term, a reasonable price can be determined by looking at the market for the goods.

ANSWER: TRUE OR FALSE

19. An unconscionable contract is a contract so one-sided and unfair at the time it is made that enforcing it would be unreasonable.

ANSWER: TRUE OR FALSE

20. A seller with voidable title can transfer good title to a good faith purchaser for value.

ANSWER: TRUE OR FALSE

21. A buyer has an insurable interest in identified goods.

ANSWER: TRUE OR FALSE

MULTIPLE CHOICE QUESTIONS

22. Expert Stitching Corporation enters into a contract to sell denim clothing to Fine Fashion Company, which in turn sells a pair of jeans to Grady, a consumer. In contrast to standards that apply to consumers, the UCC imposes on merchants

a. less strict legal standards.
b. special merchant standards.
c. stricter ethical standards.
d. the same overall standards.

23. Rikki and Sid are preparing a sales contract. Generally, with respect to the specific contractual provisions when drafting the contract they

a. are limited by the UCC
b. can agree to whatever terms they wish.

24. Doctors Medical Clinic orders 1,000 bandages from Emergency Supplies Company but fails to specify the sizes. The bandages are delivered in an assortment of sizes. Doctors Medical Clinic may

a. accept the bandages “as is” only.
b. accept the bandages “as is” or reject the entire shipment only.
c. accept only the bandages that it wants and reject the rest.
d. reject the entire shipment only.

25. Jones v. Star Credit Corp. was decided on the issue of

a. good faith.
b. square dealing.
c. the mere image rule.
d. unconscionability.

26. A specific grade of corn that fills BioFuel Cooperative’s silo is fungible. This means that the corn is

a. alike naturally or by agreement or trade usage.
b. fundamentally different.
c. fundamentally edible.
d. perishable.

CHAPTER 12

TRUE/FALSE QUESTIONS

27. Under the UCC, a seller’s tender of goods that do not conform in every way to a contract is not a valid tender.

ANSWER: TRUE OR FALSE

28. In contracts involving a carrier, a seller can complete performance only through a shipment contract.

ANSWER: TRUE OR FALSE

29. The term cure refers to the right of the seller to reject, adjust, or replace nonconforming goods.

ANSWER: TRUE OR FALSE

30. The doctrine of commercial impracticability only extends to problems that could have been foreseen.

ANSWER: TRUE OR FALSE

31. In general, a buyer’s duty to pay for tendered goods becomes absolute be¬fore the buyer has had an opportunity to inspect the goods.

ANSWER: TRUE OR FALSE

32. If, before the time for performance, a buyer communicates an intent not to perform, the seller can consider the buyer in breach and pursue a remedy.

ANSWER: TRUE OR FALSE

33. If a buyer breaches a contract and the seller resells the goods to another party, the seller cannot recover any loss from the breaching buyer.

ANSWER: TRUE OR FALSE

MULTIPLE CHOICE QUESTIONS

34. International Gem Corporation agrees to sell Jewel Outlets, Inc. (JOI), fifty new diamonds, but the contract does not specify a place of delivery. JOI is expected to pick up the goods. The place of delivery is

a. International’s place of business.
b. JOI’s place of business.
c. the Annual Gems and Jewels Convention.
d. the U.S. Postal Service office nearest to JOI’s place of business.

35. Screen Perfect, Inc., and TV Stores enter into a contract for a sale of high-definition television sets. Screen Perfect ships goods that do not exactly conform to the contract in some details. TV Stores

a. cannot reject the entire shipment.
b. can reject the entire shipment.
c. must accept the entire shipment.
d. must reject the entire shipment.

36. Food Packaging, Inc., agrees to sell 50,000 6-ounce yogurt containers to Golden Dairy Company. Food can obtain only 20,000 of the 6-ounce contain¬ers, but also ships 30,000 more expensive 8-ounce containers for the same price. Under these circumstances, Golden

a. cannot reject delivery, and Food cannot later replace the containers.
b. cannot reject delivery, but Food can later replace the containers.
c. may reject delivery, and notice to Golden of Food’s intent to cure will give Food a reasonable time to replace the containers.
d. may reject delivery, but Food cannot later replace the containers.

37. InMaple Farms, Inc. v. City School District of Elmira, the defense of commercial impracticability will not excuse the performance of a contractual obligation when there is an increase in the seller’s costs while the contract is in force

a. unless the increase in the seller’s costs is substantial.
b. under any circumstances.
c. unless the increase in the seller’s costs makes it impossible for the seller to perform without losing money.
d. unless the increase in the seller’s costs was not foreseeable at the time the contract was formed.

38. Mineral Resource Company contracts to provide several manufacturers with tin. When a cartel of tin-producing countries suddenly embargoes future shipments of tin to Mineral Resource so that it cannot fulfill its contracts, the distributor

a. can substitute some other material for the tin.
b. is excused from the performance of its contracts.
c. is liable for breach of contract.
d. must still supply the tin needs of its customers.

CHAPTER 13

TRUE/FALSE QUESTIONS

39. In Webster v. Blue Ship Tea Room, the Court decided that the mere presence of a fish bone in fish chowder did not constitute a breach of the implied warranty of merchantability.

ANSWER: TRUE OR FALSE

40. Merchants are required to warrant that the goods they sell are fit for their ordinary purpose.

ANSWER: TRUE OR FALSE

41. A manufacturer’s liability to an injured party on a strict product liability theory is limited to a refund or a replacement of the defective product.

ANSWER: TRUE OR FALSE

42. A public policy underlying the imposition of strict product liability is that consumers should be protected against unsafe products.

ANSWER: TRUE OR FALSE

43. An inadequate warning is not a product defect that will support the imposition of liability on a strict product liability basis.

ANSWER: TRUE OR FALSE

44. Federal law prohibits vague generalities and obvious exaggerations in advertising.

ANSWER: TRUE OR FALSE
45. A person who receives unsolicited merchandise and keeps it without notifying the sender commits mail fraud.

ANSWER: TRUE OR FALSE

MULTIPLE CHOICE QUESTIONS

46. Olga, a salesperson for Pre-owned Cars & Trucks, Inc., tells Quincy, “This is the best car I’ve ever seen.” This statement is

a. an express warranty.
b. an implied warranty.
c. a warranty of title.
d. puffery.

47. Parker, a salesperson for Quality Textiles, Inc., showsRosa, a fabric buyer for Style Clothing Company, samples of cloth, stating that any ship¬ment will match the samples. This statement is

a. an express warranty.
b. an implied warranty.
c. a warranty of title.
d. puffery.

48. Ceramic Tile Company designs and makes floor tiles. In a product liability suit based on negligence, Ceramic could be liable for vio¬lating its duty of care with respect to

a. neither the design nor the making of the tiles.
b. the design and the making of the tiles.
c. the design of the tiles only.
d. the making of the tiles only.

49. Frosty’s Appliance Store advertises freezers at a “Special Low Price of $299.” When Garth tries to buy one of the freezers, Huey, the salesperson, tells him that they are all sold and no more are obtainable. Huey adds that Frosty’s has other freezers for $2,299. This is

a. a legitimate sales technique.
b. bait-and-switch advertising.
c. counteradvertising.
d. puffery.

50. 13. Cold Stuf, Inc., makes snowboards, which it sells to Deep Freeze Sports Store (DFS). DFS sells Cold Stuf boards to consumers, in¬cluding Ed. Ed is in¬jured while using the board. In a product liabil¬ity suit based on strict li¬ability, Ed may recover from

a. Cold Stuf only.
b. Cold Stuf or DFS.
c. DFS only.
d. no one.

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